Intel accuses Qualcomm

Intel accuses Qualcomm of trying to kill mobile chip competition

Intel says Qualcomm's patent spat with Apple is really about quashing competition from Intel.

Intel has jumped into the fray surrounding the Apple-Qualcomm patent spat by accusing the world's biggest maker of mobile phone chips of trying to use the courts to snuff out competition.


The chip giant made the allegation late Thursday in a public statement (PDF) to US International Trade Commission. The commission had requested the statement as part of its investigation into Qualcomm's accusation that Apple's iPhones of infringe six of Qualcomm's mobile patents.
Specifically, Intel said, the case is about quashing competition from Intel, which described itself as "Qualcomm's only remaining competitor" in the market for chips for cellular phones.



"Qualcomm did not initiate this investigation to stop the alleged infringement of its patent rights; rather, its complaint is a transparent effort to stave off lawful competition from Qualcomm's only remaining rival," Intel said in its statement. "This twisted use of the Commission's process is just the latest in a long line of anticompetitive strategies that Qualcomm has used to quash incipient and potential competitors and avoid competition on the merits."


Intel's statement is the latest salvo in Qualcomm's battle with Apple. The two companies have been fighting over patents since January, when Apple filed suit against Qualcomm in the US and said the wireless chipmaker didn't give fair licensing terms for its technology. It wants to pay a lower amount for using Qualcomm technology in its devices.

Qualcomm, the world's biggest provider of mobile chips, maintains that no modern handset -- including the iPhone -- would have been possible "without relying upon Qualcomm's fundamental cellular technologies." The company derives a significant portion of its revenue from licensing that technology to hundreds of handset manufacturers and others.

Intel's statement goes on to accuse Qualcomm of maintaining a monopoly on cell phone modems through what it calls the anticompetitive practice of "no license, no chips." The policy requires equipment manufacturers to pay "exorbitant" royalties to Qualcomm for every device they sell, regardless of whether it contains a Qualcomm chip, Intel said.
Any disagreement is met with the threat of cutting off the equipment maker's supply of chips, Intel said.


Another part of Qualcomm's alleged anticompetitive behavior is its refusal to license its standard-essential patents to competitors. Standard-essential patents cover technology deemed essential to the industry and must be licensed to competitors under fair, reasonable and nondiscriminatory terms (FRAND). But Intel alleges that Qualcomm refuses to license some standard-essential patents to rival chipmakers, in violation of its FRAND commitments.

Intel also accused Qualcomm of entering into an agreement with Apple in which the iPhone maker would use its chips exclusively in exchange for lower licensing fees, excluding competitors and harming competition. "These arrangements foreclosed rivals like Intel from competing for Apple's vital business," Intel said.

Apple previously paid the licensing fee through its manufacturers, but it stopped paying those royalties for devices sold during the March quarter. Apple said it's been trying to reach a licensing agreement with Qualcomm for more than five years, but said the terms offered by Qualcomm weren't fair.

The ITC likely will start examining the complaint in August, with a trial expected next year.
Qualcomm didn't immediately respond to a request for comment.

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Indirabali